How Do You Identify a Candle Pattern?

To identify a candlesticks pattern you will need to first learn about the various candlesticks patterns & learn under which setup these patterns form on the chart & what forex signal is generated by each of these candlesticks patterns.

Among the various popular candles patterns that every forex trader should know are:

Doji Candlesticks - How to Identify a Candlestick Setup

This is a candle setup with the same opening and closing price. There are various types of doji candlesticks pattern which form on Forex charts.

following examples explain various patterns of the doji candlestick:

Long legged doji candle pattern has long upper and lower shadows with opening and closing price at the middle. When Long legged doji appears on a chart it indicates indecision between currency traders, buyers & the sellers.

Shown Below is example screenshot image of the Long Legged Doji candlesticks pattern

Doji Candle Pattern - Doji Candles - How to Identify Candles Pattern

Doji Candlestick Pattern - Doji Candles - How to Identify Candles Pattern

Marubozu Candlesticks - How to Identify a Candlestick Setup

Marubozu forex candle setup are long candles which have no upper or lower shadows, Like the examples illustrated below.

Marubozu Candlesticks - How to Identify a Candlestick Setup

Marubozu forex candle setup are continuing forex candle patterns that show price is going to continue in same direction as that of the marubozu candlestick. The marubozu candle-sticks pattern can be white/blue or Black/red depending on direction of the trend.

Spinning Tops Candlestick Setup - How to Identify a Candlestick Setup

Spinning tops candle setup have a small body with long upper & lower shadows. These spinning top candles are referred to by this term because these candlesticks formations are similar to spinning top on a matchstick.

The upper and lower shadows of the spinning top candles pattern are longer than the body. The example below shows the spinning top candlestick pattern. You can look for pattern in your MT4 Software charts. The example below shows a screen-shot to help traders when it comes to learning & understanding these forex candle setup.

How Do I Interpret Forex Candle Charts - Spinning Tops Candlesticks - How to Identify a Candlestick Setup

Colour of the spinning top candle candlesticks pattern is not important, this formation shows indecision between buyers & sellers in the market. When these forex patterns appear at the top of a trend or at the bottom of trend it may signify that the trend is coming to an end & it may soon reverse & start moving the opposite direction. However, it's better to wait for confirmation signals that direction of a currency has reversed before taking the signal from this candle pattern formation.

Hammer Candlestick Setup & Hanging Man Candle Setup Candlesticks

Hammer Candle Setup & Hanging Man Candlestick Setup candles look alike but hammer is bullish reversal candlestick pattern and hanging man is a bearish reversal candlestick setup.

Hammer Candlestick Pattern & Hanging Man Candle Setup Candles - Candlesticks Patterns - How to Identify a Candlestick Setup

Hammer Candlesticks - How to Identify a Candlestick Setup

Hammer candle setup is a potentially bullish forex candle pattern that forms during a downtrend. It's named so because the market is hammering out a bottom.

Hanging Man Candle Trade - How to Identify Candlestick Setups

This hanging man candle setup is a potentially bearish forex reversal signal which forms during a uptrend. It's named so because it resembles a man hanging on a noose up high.

Hanging Man Candle Setup - How to Identify a Candlestick Setup

Inverted Hammer Candlestick Trade - How to Identify a Candlestick Setup

This is a bullish reversal candlestick setup. It forms at the bottom of a trend.

Inverted hammer candle pattern occurs at the bottom of a downtrend and indicates the possibility of market reversal of the downward Forex trend.

Inverted Hammer Candlestick Setup - How to Identify a Candlestick Setup

Shooting Star Candle Trade - How to Identify a Candlestick Setup

Shooting Star is a bearish reversal candle-stick setup. It occurs at the top of market trend.

Shooting Star candle pattern occur at the top of an uptrend in the market where the open price is same as the low and price then rallied upward but was forced back downward to close at near the open.

Shooting Star Candlestick - How to Identify a Candlestick Setup

Piercing Line Candlesticks Trading - How to Identify a Candlestick Setup

Piercing line candle setup is a long black body followed by a long white body candles.

White body pierces the midpoint of the prior black body.

This Piercing Line forex candlestick setup is a bullish reversal candle pattern that occurs at the bottom of a market downtrend. It shows that the market opens lower and closes above the midpoint of the black body.

This Piercing Line forex candle setup displays that the momentum of the downtrend is reducing and the market trend is likely to reverse & move in an upward direction.

This Piercing Line forex candle pattern is displayed known as a piercing line signifying the market is piercing the bottom illustrating a market floor for currency price downward trend.

Piercing Line Candlestick Setup - Candlesticks Patterns - How to Identify a Candlestick Setup

Dark Cloud Cover Candlestick Trade - How to Identify Candlesticks

Opposite of piercing candle forex trading candlestick.

This candle-stick is a long white body followed by a long black body.

The black body pierces the mid-point of previous white body.

This is a bearish reversal pattern which forms at the tops of an uptrend.

Dark Cloud forex candlestick setup that the market opens higher and closes below the midpoint of the white body.

Dark Cloud forex candle setup displays that the momentum of the uptrend is reducing and the market trend is likely to reverse & move in a downward trading direction.

Dark Cloud forex candle setup is pictured known as a cloud cover signifying the cloud as a ceiling for currency price upward forex trend.

Dark Cloud Cover Candlestick Setup - How to Identify a Candle Setups

Morning Star Candle Trade - How to Identify Candlestick Setups

Morning Star Candle Setup - Candlesticks Patterns - How to Identify a Candlestick Setup

Evening Star Candle Trade - How to Identify Candlesticks Patterns

Opposite of morning star candlesticks pattern

Evening Star Candle Setup - Candlesticks Patterns - How to Identify a Candlestick Setup

Engulfing Candle Sticks Patterns - How to Identify a Candlestick Setup

Engulfing is a reversal candle pattern which can be bearish or bullish depending upon whether it appears at the end of a market downtrend or at the end of a market uptrend.

Bullish & Bearish Engulfing Candlesticks Patterns - Candlesticks - How to Identify a Candlestick Setup

Drawing Forex Candlesticks on MT4 - Candles Patterns Guide for Day Trading

Forex Candlesticks patterns that every forex trader should know.